Digital Realty Trust has completed the acquisition of a three-property data center portfolio in Paris area from Bouygues Telecom for €60 million ($80.3 million US). It was structured as a sale-leaseback transaction, with Bouygues selling the three properties to Digital Realty, then immediately signing long-term, triple net leases for all three facilities. It’s a mutually beneficial transaction that boosts Digital Realty’s portfolio and frees up capital for Bouygues to use for other means.
The portfolio consists of one Tier III+ facility at Montigny-le-Bretonneux and two Tier III facilities in Bievres and Saclay. The properties total approximately 87,000 rentable square feet, with nearly five megawatts of IT capacity.
"The acquisition of this institutional-quality portfolio further expands our footprint in this key European market and, equally important, adds a new network and IT service provider to our global customer base," said Michael Foust, Chief Executive Officer of Digital Realty.
This works for Bouygues by unlocking that capital for use in other, productive ways. "We're very pleased to have established a long-term strategy for our infrastructure assets with a leading global provider of data centre solutions," said Richard Viel, Deputy Chief Executive Officer of Bouygues Telecom. "Digital Realty's global portfolio, financial strength and proven long-term investment philosophy provides the stable operating environment we were seeking to continue to grow our business in France."
The deal works for Digital Realty as it provides three more fully leased data center properties to add to an ever-expanding portfolio. "This acquisition demonstrates our ability to source and complete a highly structured transaction, enabling the seller to monetize its data centre real estate assets while continuing to maintain its critical operations with a well-capitalized, long-term data centre owner," added Scott Peterson, Chief Acquisitions Officer of Digital Realty. "Similar to the Sentrum portfolio in London that we acquired in July 2012, this is a continuation of our strategy of expanding our European footprint by acquiring high-quality, operating data centre facilities that are home to top tier global brands."